The 2026 half-year reports of global chemical giants paint a nuanced picture: industry-wide profit recovery is real, but its fruits are unevenly distributed. Asian refining-petrochemical integrated players are the biggest winners, with China's Wanhua Chemical posting a 64.35% year-on-year increase in net profit, while Hengyi Petrochemical, Eastern Shenghong, and Rongsheng Petrochemical saw profits multiply. This contrast reveals a deeper shift in the competitive logic of the chemical industry, with direct implications for upstream textile raw material supply and price expectations.
Data Behind the Divergence
According to public disclosures, BASF's second-quarter sales reached EUR 17.206 billion, with operating profit surging 137.1% year-on-year. INEOS, Covestro, and Wacker all returned to profitability. But Europe is not uniformly strong: Evonik's profit dipped, Lanxess's losses widened, and Solvay saw declines in both revenue and profit. In the US, Dow swung to profit after significant losses, and Westlake also turned around, while Celanese and IFF reported profit declines.
This divergence is not accidental. The recovery is driven mainly by improved chemical product spreads and constrained overseas capacity, but downstream demand strength and raw material cost volatility continue to sway performance. In other words, the industry-wide rebound resembles a cyclical uptick rather than a full recovery. For textiles, this suggests greater volatility in upstream raw material prices and widening regional spreads, making cost control harder for buyers.
Asia's Rise and Textile Raw Material Transmission
The standout signal in these reports is the surge of Asia's chemical sector. Wanhua Chemical's first-half revenue reached RMB 119.316 billion, with net profit of RMB 10.063 billion, up 64.35%. Taiwanese chemical firms collectively returned to profit, while Japanese and Korean companies mostly saw sharp profit gains. Saudi SABIC, however, swung to a loss, underperforming the industry average—a sign that resource-based advantages are being eroded by integration and high-value-added businesses.
For the textile chain, the rise of refining-petrochemical integrated players means the supply landscape for PX, PTA, and MEG is being reshaped. Domestic integration dividends are reducing reliance on imported raw materials but may also intensify homogenized competition. Textile mills and fabric producers must watch whether upstream profit recovery leads to cost pass-through, and whether integrated giants' push into specialties affects the availability of functional fiber inputs.
Segment Insights and Procurement Strategy
Among sub-sectors, industrial gases saw Linde and Air Liquide grow steadily while Air Products suffered heavy losses; crop science was stable; fertilizer makers diverged; and coatings leaders grew steadily. These mixed results reinforce one judgment: companies with integrated layouts and high-value specialty businesses are better equipped to withstand cycles.
For textile companies, this means supplier selection should look beyond spot prices to assess feedstock self-sufficiency and product mix. BASF's and other European firms' profit surges partly reflect supply gaps from constrained overseas capacity—a temporary advantage. Asian integrated players' cost edge, meanwhile, may depress some bulk raw material prices in the medium term, providing a buffer for fabric makers' margins.
Practical Recommendations
For Procurement Teams - Track capacity dynamics and maintenance schedules of integrated petrochemical firms to lock in medium-term contracts during spread windows. - Include feedstock self-sufficiency in supplier evaluations, prioritizing companies with high integration and a reasonable specialty ratio. - Stay alert to price gaps between European, US, and Asian sources, adjusting procurement structures as regional spreads widen.
For Trading Companies - Add raw material price fluctuation clauses in export quotations to avoid margin erosion from upstream cost swings. - Monitor currency and freight ripple effects from improved chemical spreads, adjusting settlement currencies and logistics plans accordingly.
- Forge strategic partnerships with chemical firms that have high-value-added product lines, enhancing the competitiveness of exported textiles.
The window of profit recovery remains open, but the chasm of divergence is deepening. For the textile industry, reading upstream chemical giants' half-year reports is not just a window into raw material prices, but a coordinate for anticipating future competitive dynamics.